Category Archives: General

Avoid These Costly House Price Assumptions

By now everyone should be aware that house prices don’t always move rationally, and in some cases can move very irrationally to the detriment of new home owners.

In fact, according to recent data, more than 10% of all US homes with a mortgage are still “underwater” (i.e. have negative equity) as a result of the after effects of the financial crisis that occurred more than five years ago.

Prices in certain areas are going up, up, up....Photo credit: © Lunamarina
Prices in certain areas are going up, up, up….

While very few people, including the financial experts, foresaw the housing crisis and appreciated the complex effects it would have on homeowners across the country, there are some basic steps you can take as a potential home buyer to limit your risk in making what is likely the most important purchase decision of your life.

While DIY tools now allow shoppers to compare historical home prices, tax information and piece together neighborhood trends, it’s important not to view this type of data in a vacuum, nor make overly rosy projections based solely on historical data.

That’s the message of a new paper by the National Bureau of Economic Research, which looked at house price dynamics that led up to “bubble” situations such as in the immediate run up to the 2008 financial crisis. While the paper is fairly technical, there are a few recommendations you can apply from it which may help inform your own research and strategy for buying a new home:

1. Historical price increases do not necessarily reflect current demand

Shopping for a new home and seeing dramatic recent increases in prices may tell you it’s time to buy before prices rise even higher. Unfortunately, a decision like that could also lead you to buying in at the height of a bubble. Past home prices don’t tell you about the current fundamentals of your area’s market. Overlooking this fact is a mistake many new homebuyers made in the mid-2000s.

2. Be Wary of Multiple Big Price Increases Within Short Periods of Time

This could be a sign that prices in your city or state are becoming disjointed from market fundamentals. Before you splash down that premium, consider consulting with a professional who may have a better idea of the market’s supply and demand dynamics, which are equally as important as price trends.

3. Home prices keep rising—until they don’t

As simple as this axiom sounds, many people forgot it in the mid-2000s and compounded their errors with small or no down payments on homes they couldn’t really afford. The odds of another synchronized national housing crisis of the likes of 2008 is thankfully fairly small, but mini-bubbles can pop up in certain cities, counties or even neighborhoods.

Today, prices in metropolitan areas like San Francisco, New York and Washington DC are breaking all previous local records. Whether these are “bubbles” or an accurate long-term reflection of future demand is not for us to say, but does likely warrant further investigation before making a purchase.

Use data on historical home prices as one tool of many when making a decision on a property purchase. Consider your needs for the property, time horizon and other factors before pulling the trigger, particularly in areas where home prices have risen substantially in short periods of time.

Hang Up on this IRS Scam

 

According to the Associated Press, a nationwide tax scam has cost Americans over $15 million and counting since 2013. In fact, testimony from a Treasury deputy inspector general notes that these scammers are operating the largest and most pervasive scam on record.

Don't let fake IRS agents separate you from your money.
Don’t let fake IRS agents separate you from your money. Photo credit: Chris Potter

The odds are you or someone you know could be or already has been targeted. As tax season approaches deadline day, it’s likely that this scam will become even more frequent immediately after April 15th.

Here are some tips from the professionals on how to avoid getting ensnared in this IRS scam:

  1. Know that the IRS does not initiate contact by phone. They will send multiple pieces of correspondence by mail detailing any back taxes or fine you are responsible for.
  1. The IRS does not act like debt collectors. The hallmarks of this scam invoke aggressive and even threatening accusations over the phone, in the vein of the worst types of debt collectors. The IRS does not use the phone this way and would also not use aggressive language to collect immediately on back taxes.
  1. The IRS does not demand payment by debit or credit card over the phone. The scammers in this case are pushing their victims to load up prepaid debit cards to then transfer the money to an account over the phone. This is not a practice that the IRS partakes in.

This scam has been so successful because it plays on people’s fears and ignorance about official procedures. The most important thing you can do is stay up to date on your records and be 100% sure of your current standing with the IRS and other government agencies that collect taxes.

With that confidence and your knowledge of how the IRS actually works, you can feel confident to hang up on any fake IRS agents who may be looking to part you with your money this year.

Don’t Believe Everything You Read on Facebook

Our parents used to tell us “don’t believe everything you see on TV.” Their parents told them, “don’t believe everything you read.” Has the time come to warn our kids about the dangers of believing every Facebook update they encounter? Sadly, the answer appears to be yes…and it’s not just kids who are the gullible ones, we are too!

Not everything that grows on Facebook is so pleasant. Photo credit: mkhmarketing
Not everything that grows on Facebook is so pleasant. Photo credit: mkhmarketing

In fact, according to a recent survey, a majority of Americans now view search engines (something Facebook aspires to be) as a more credible source of news than actual news sites. This might be considered disturbing for a number of reasons, not least of which involves the “right to forget” controversy impacting Google in Europe.

On the bright side, it seems like news aggregators such as Facebook are taking their newfound powers seriously, by adjusting their algorithms to root out news sources of questionable quality, as well as outright hoaxers.

Gawker offered up a comprehensive article outlining some of the worst offenders. These are sites that rely on click bait from controversial and often straight-up false headlines to drive surges of traffic to their sites. While Facebook can be applauded for improving the aggregation of their news content, it’s good to keep in mind this won’t solve everything.

Here are additional ways you can get tripped up by fake Facebook news:

1. Uncle Bob’s impassioned theories about the IRS/vaccines/other

We all have a friend or family member with “out there” views that we have either hidden from our news feed or keep on it just to laugh at.

Keep in mind that all 450 of your friends also have an Uncle Bob connected to them, and not everyone agrees on the definition of “crazy.”

Many people on your news feed and connected to it will think nothing of sharing and promoting opinions as fact. Before you click the share button…investigate and verify.

2. Satirical Articles

Satire can be hilarious and brilliant, but when casually scanning your Facebook feed it can be easy to get caught up by sources other than The Onion.

Many serious news sites like the New Yorker and New York Times utilize comic writers and satirists and will promote their work on Facebook. Before you share a “news item” make sure it’s real or soon you will be the butt of jokes among your Facebook friends.

3. Scams

More concerning than your crazy uncle or taking a satirical article seriously is falling for one of the multitude of scams that live on Facebook.

From “viral video” links that load malware on your hard drive to a new “free giveaway” that tricks you into giving up your personal information to hackers, there are many ways to get ripped on Facebook from seemingly innocuous information.

Kim Komando has a good roundup of the methods scammers use to separate users from their money.

As social media becomes an increasingly normal part of life for people of all ages, it’s good to be conscious of the fact that misinformation that used to spread by TV, radio and phone will all find a natural home on social media platforms like Facebook. Use common sense, your intuition and verify the information before you trust it.

Data Science Goes Mainstream With White House Appointment

 

Last week, President Obama appointed the nation’s first chief data scientist, Dr. DJ Patil.

Dr. Patil was instrumental in developing the field and famously called data science “the sexiest job of the 21st century.” In fact, Patil is credited with creating the term “data scientist” in the first place.

The word everyone is focused on these days. Photo credit: justgrimes
The word everyone is focused on these days. Photo credit: justgrimes

Highlighted below are some resources to catch you up on the career of the nation’s first Chief Data Scientist and why data science is gaining so much attention with businesses and governments worldwide.

And don’t forget, if you have a strong data science background, BeenVerified is looking for a data scientist of our own. Check out the details of the position on our careers page if you’re interested.

Here’s a summary of the key announcements and background behind the naming of DJ Patil as Chief Data Scientist and what he will focus on while holding the office.

The White House Names Dr. DJ Patil as the First U.S. Chief Data Scientist

A Memo to the American People from U.S. Chief Data Scientist Dr. DJ Patil

Fast Company profile on the rise of DJ Patil from 2012.

How many times will you move in your life?

 

According to data blog FiveThirtyEight, the average person will move 11.4 times in his or her lifetime. That’s a lot of moves in its own right, but the potential for younger people to move even more than that is a real possibility.

The average American will move homes more than 11 times. Photo credit: Nick Aldwin
The average American will move homes more than 11 times. Photo credit: Nick Aldwin

There are a number of reasons for this, including the effects of the financial crisis which some pundits have speculated means more younger people renting rather than buying their homes. This could naturally lead to more people moving as their leases expire for a better deal elsewhere.

Another reason for a potentially higher number of moves also has to do with the economy and people’s willingness to change cities for work. This is particularly true of younger people, who are increasingly delaying ties like marriage and having children, in addition to home ownership.

In his book, The New Geography of Jobs, Enrico Moretti argues that the United States is increasingly composed of “brain hubs” or cities with high quality jobs that attract clusters of knowledge workers. Young workers with decent skills and education may make many different circuits between cities like San Francisco, Austin, DC and New York as they seek new opportunities.

This type of brain hub landscape is a far cry from our grandparents’ world of securing a job for life in their hometowns.

However, the FiveThirtyEight article also notes that this increased mobility isn’t always the result of in demand workers chasing the next great opportunity:

When surveyed by the Census Bureau about why they moved in the past year, people gave reasons including searching for a better home (cited by 15 percent of movers), cheaper housing (8 percent), and foreclosure or eviction (2 percent). Sometimes staying put is a sign of stability.

No matter what reasons have caused your moves, there are a lot of reasons you may need to reference your past address information. If you need help remembering details you can utilize a background check service like BeenVerified’s which will give you historical address information in one report.

Check out the full article on what’s driving the moves of many Americans on FiveThirtyEight above and let us know if you are over or under the average for moves in the comments section.

Your Stupidly Simple Password Is Begging to Be Hacked

 

 2014 was finally the year that Internet and data security became mainstream concerns from the celebrity iCloud hack to the alleged cyber assault by North Korea on Sony Pictures.

Use a creative combination of letters and numbers for your password. Photo credit: Jhayne
Use a creative combination of letters and numbers for your password. Photo credit: Jhayne

Despite the constant headlines about the importance of a strong password, it seems few of us are taking that imperative seriously, based on the just released list of last year’s most popular passwords, compiled by SplashData.

As Fast Company reports, some of the most common passwords are so simple such as “123456” and the perennial favorite “password” that one wouldn’t need a degree in computer science to hack into your computer or cloud storage account.

While you can see the full list of laughably simple and obvious passwords here, you may need a refresher on what makes for good password hygiene.

According to SplashData, here are three simple steps to make a strong password:

1. Use passwords of eight characters or more with mixed types of characters.

2. Avoid using the same username/password combination for multiple websites.

3. Use a password manager to organize and protect passwords, generate random passwords, and automatically log into websites.

It’s no surprise that SplashData offers one such password manager solution, but others include the well-reviewed 1Password which allows you to use just one password across all sites while it encrypts your information quickly and relatively easily.

Until we reach the days of ubiquitous finger print readers and retina scanners, the traditional password will be dogging our digital lives. Make yours smarter and hopefully you will stay off this map in 2015.